Alberta's possible pivot to the left alarms Canadian oil sector

CALGARY, Alberta May 4 (Reuters) - Canada's oil-rich
province of Alberta is on the cusp of electing a left-wing
government that can make life harder for the energy industry
with its plans to raise taxes, end support for key pipeline
projects and seek a bigger cut of oil revenues.

Polls suggest Tuesday's election is set to end the
Conservative's 44-year reign in the province that boasts the
world's third-largest proven oil reserves and now faces
recession because of the slide in crude prices. [IDn:L1N0XS117]

Surveys have proven wrong in Canadian provincial elections
before and voters may end up merely downgrading the
Conservatives' grip on power to a minority government.

Yet the meteoric rise of the New Democratic Party and the
way it already challenges the status-quo of close ties between
the industry and the ruling establishment has alarmed oil
executives. The proposed review of royalties oil and gas
companies pay the government for using natural resources and
which could lead to higher levies, is a matter of particular
concern.

"Now is not the time for a review of oil and natural gas
royalties," Tim McMillan, president of the Canadian Association
of Petroleum Producers, the country's top oil lobby, said in a
statement.

A 2007 increase in the levy was rolled back when the global
financial crisis struck and oil executives say today the time is
equally bad to try it again.

Yet the left's leader Rachel Notley, a former union activist
and law school graduate, has shot up in popularity ratings in
the past months advocating policies that have been anathema for
many conservative administrations.

She says she would not lobby on behalf of TransCanada Corp's
controversial Keystone XL pipeline or support building
of Enbridge Inc's Northern Gateway pipeline to link the
province's oil sands with a Pacific port in British Columbia.
Citing heavy resistance from aboriginal groups to the Enbridge
line, Notley says Alberta should back those that are more
realistic such as TransCanada's Energy East pipeline to the
Atlantic ocean.
Continued...